SBA to Interpret Supreme Court Contractor Ruling for Small Business

This month’s Supreme Court decision requiring the Veterans Affairs Department to expand set-asides for veteran-owned small businesses could affect broader procurement regulations across government, a Small Business Administration official said on Tuesday.

John Shoraka, associate administrator of SBA’s Office of Government Contracting and Business Development, told Government Executive at a contractors networking event that “the path forward is that we have to interpret how the decision impacts the Small Business Act.”

The court’s June 16 decision in Kingdomware Technologies Inc. v. the United States determined that the so-called “rule of two” requirement that the VA consider at least two bidding contractor firms (and apply a set-aside to the one that qualifies) must apply to supply orders as well as contracts.

“There was a perception that a [pre-existing schedule] order was not a contract, so the rule didn’t apply,” Shoraka told the audience. “But the Supreme Court says it is a contract, so now we know,” and the department must pick the veteran-owned small business assuming it offers a reasonable price.

Shoraka testified at a June 23 hearing on the Kindomware ruling at the Senate Small Business and Entrepreneurship Committee, noting that the high court was silent on whether that interpretation of the rule of two applies to set-asides at other agencies. “We are carefully reviewing the potential impact of the Kingdomware case, both in terms of small business goaling and the operation of the Small Business Act,” he told lawmakers. “SBA will be conferring with the Department of Justice, the [Small Business Procurement Advisory Council], the General Services Administration (as managers of the Federal Supply Schedules), the Federal Acquisition Regulatory Council, and others to discuss if any changes to regulations are needed.”

Read more: SBA to Interpret Supreme Court Contractor Ruling for Small Business